CHAPTER 4. Recreation and Park Districts [5780 - 5796.20]

ARTICLE 9. Finance [5788 - 5788.25]

On or before July 1 of each year, the board of directors shall adopt a preliminary budget that shall conform to the accounting and budgeting procedures for special districts contained in Subchapter 3 (commencing with Section 1031.1) of, and Article 1 (commencing with Section 1121) of Subchapter 4 of Division 2 of Title 2 of the California Code of Regulations. The board of directors may divide the preliminary budget into categories, including, but not limited to:

(a) On or before July 1 of each year, the board of directors shall publish a notice stating all of the following:

(1) That it has adopted a preliminary budget that is available for inspection at a time and place within the district specified in the notice.

(2) The date, time, and place when the board of directors will meet to adopt the final budget and that any person may appear and be heard regarding any item in the budget or regarding the addition of other items.

(b) The board of directors shall publish the notice at least two weeks before the hearing in at least one newspaper of general circulation in the district pursuant to Section 6061 of the Government Code.

At the time and place specified for the meeting, any person may appear and be heard regarding any item in the budget or regarding the addition of other items. The hearing on the budget may be continued from time to time.

On or before August 30 of each year, after making any changes in the preliminary budget, the board of directors shall adopt a final budget. The board of directors shall forward a copy of the final budget to the auditor of each county in which the district is located.

At any regular meeting or properly noticed special meeting after the adoption of its final budget, the board of directors may adopt a resolution amending the budget and ordering the transfer of funds between categories, other than transfers from the restricted reserve for capital outlay and the restricted reserve for contingencies.

(a) In its annual budget, the board of directors may establish a restricted reserve for capital outlay and a restricted reserve for contingencies. When the board of directors establishes a restricted reserve, it shall declare the exclusive purposes for which the funds in the reserve may be spent. The funds in the restricted reserve shall be spent only for the exclusive purposes for which the board of directors established the restricted reserve. The reserves shall be maintained according to generally accepted accounting principles.

(b) Any time after the establishment of a restricted reserve, the board of directors may transfer any funds to that restricted reserve.

(c) If the board of directors finds that the funds in a restricted reserve are no longer required for the purpose for which the restricted reserve was established, the board of directors may, by a four-fifths vote of the total membership of the board of directors, discontinue the restricted reserve or transfer any funds that are no longer required from the restricted reserve to the district’s general fund.

On or before July 1 of each year, the board of directors shall adopt a resolution establishing its appropriations limit and make other necessary determinations for the following fiscal year pursuant to Article XIII B of the California Constitution and Division 9 (commencing with Section 7900) of Title 1 of the Government Code.

The auditor of each county in which a district is located shall allocate to the district its share of property tax revenue pursuant to Chapter 6 (commencing with Section 95) of Part 0.5 of Division 1 of the Revenue and Taxation Code.

On or before July 1 of any year, the city council of a city which is located wholly or partially within a district may adopt a resolution ordering the transfer of funds from the city to the district in an amount equal to the entire or partial amount of property tax revenue that would have been allocated to the district from the territory that is located both in the city and the district. The city shall file certified copies of its resolution with the district and the county auditor. Pursuant to Section 96.8 of the Revenue and Taxation Code, the county auditor shall compute and implement an effective tax rate reduction. A city’s decision to pay funds to a district in lieu of property tax revenues is effective only for the fiscal year for which it is made.

(a) A district may accept any revenue, money, grants, goods, or services from any federal, state, regional, or local agency or from any person for any lawful purpose of the district.

(b) In addition to any other existing authority, a district may borrow money and incur indebtedness pursuant to Article 7 (commencing with Section 53820), Article 7.4 (commencing with Section 53835), Article 7.5 (commencing with Section 53840), Article 7.6 (commencing with Section 53850), and Article 7.7 (commencing with Section 53859) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.

(a) A district may acquire any necessary real property by borrowing money or purchasing on contract pursuant to this section. That indebtedness shall be in addition to any bonded indebtedness authorized by the voters.

(b) The amount of indebtedness shall not exceed an amount equal to two times the actual income from property tax revenues received pursuant to Section 5788.13 for the fiscal year preceding the year in which the indebtedness is incurred. Any indebtedness shall be repaid within 10 years from the date on which it is incurred. An indebtedness shall bear interest at a rate which shall not exceed the rate permitted under Article 7 (commencing with Section 53530) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code.

(c) Each indebtedness shall be authorized by a resolution adopted by a four-fifths vote of the total membership of the board of directors and shall be evidenced by a promissory note or contract signed by the chair and the secretary or the clerk of the board of directors.

(a) All claims for money or damages against a district are governed by Part 3 (commencing with Section 900) and Part 4 (commencing with Section 940) of Division 3.6 of Title 1 of the Government Code.

(b) All claims against a district shall be audited, allowed, and paid by the board of directors by warrants drawn on the treasurer.

(c) As an alternative to subdivision (b), the board of directors may instruct the county auditor to audit, allow, and draw his or her warrant on the county treasurer for all legal claims presented to him or her and authorized by the board of directors.

(d) The treasurer shall pay the warrants in the order in which they are presented.

(e) If a warrant is presented for payment and the treasurer cannot pay it for want of funds in the account on which it is drawn, the treasurer shall endorse the warrant, “NOT PAID BECAUSE OF INSUFFICIENT FUNDS” and sign his or her name and the date and time the warrant was presented. From that time until it is paid, the warrant bears interest at the maximum rate permitted pursuant to Article 7 (commencing with Section 53530) of Chapter 3 of Part 1 of Division 2 of Title 5 of the Government Code.

(a) The board of directors shall provide for regular audits of the district’s accounts and records pursuant to Section 26909 of the Government Code.

(b) The board of directors shall provide for the annual financial reports to the Controller pursuant to Article 9 (commencing with Section 53890) of Chapter 4 of Part 1 of Division 2 of Title 5 of the Government Code.